Len Nichols, Director for Health Policy Research and Ethics at George Mason University
Drug price growth (6 percent per annum) and spending growth (12 percent per annum per person) are driving overall health care costs above GDP growth again, after five straight uncommonly good years. Specialty drugs made up 1 percent of prescriptions written but accounted for 25 percent of drug spending in 2013. Spending on these medications is growing faster than for all other drugs and will account for more than 50 percent of all drug spending by 2019. Regardless of whether one takes these drugs or not, we all pay the cost. Drug prices threaten premiums and pocketbooks everywhere.
There is no doubt that we need innovation. . Drug development is expensive, time-consuming and risky in that most products never make it to market. But the tools we use to encourage innovation — patent protection of the basic science and additional market or data exclusivity once the product is declared safe and ready for sale — confer monopoly power and high profits. Our system is now set up to depend upon competition to drive down costs while providing patients with more treatment options and better value for their health care dollars.Read More